Park Aerospace (NYSE:PKE) executives highlighted stronger third-quarter fiscal 2026 profitability, a sizable fourth-quarter revenue outlook influenced by low-margin fabric resale activity, and a major capacity expansion plan during the company’s fiscal third-quarter earnings call and investor presentation. Chairman and Chief Executive Officer Brian Shore was joined by President and Chief Operating Officer Mark Esquivel.
Third-quarter results and key drivers
For the fiscal third quarter, Park reported sales of $17.333 million, gross profit of $5.903 million, and a gross margin of 34.1%. The company posted adjusted EBITDA of $4.228 million, representing an adjusted EBITDA margin of 24.4%.
ArianeGroup C2B fabric timing continued to affect quarterly mix
Management again discussed the impact of Park’s Business Partner Agreement with ArianeGroup, under which Park serves as the exclusive North American distributor of ArianeGroup’s Raycarb C2B fabric used in ablative composite materials for advanced missile programs.
Shore said Park had zero sales of the C2B fabric in the third quarter, while recording a little more than $1 million of sales from materials manufactured with C2B in the quarter. He described fabric distribution as a small-markup business, adding that tariffs are passed through dollar-for-dollar with no markup, which can further reduce the percentage margin on those sales. In contrast, Park said the manufactured prepreg materials made with C2B carry “very good margins,” and shifting between fabric-only sales and manufactured materials can distort quarterly margin trends.
Separately, Park disclosed missed shipments of approximately $740,000 in the quarter, which Shore attributed principally to international freight supply chain issues as well as customer specification and engineering issues. He characterized the reemergence of supply chain challenges as a byproduct of industry recovery and accelerating program activity.
On tariffs, Esquivel said Park saw minimal impact in the third quarter and indicated the situation had been “quiet” and appeared to be stabilizing in recent months. He added that Park’s shorter-term pricing on much of its business supports its ability to pass through costs if needed, while acknowledging changes could occur.
Commercial aerospace ramp: Airbus and GE/CFM programs in focus
A significant portion of the presentation centered on Park’s participation in GE Aerospace/CFM engine nacelle-related programs supplied through Middle River Aerostructure Systems (MRAS) under a firm pricing long-term agreement running from 2019 to 2029. Shore described the GE Aerospace jet engine programs as a major opportunity and said Park built a redundant factory as part of the arrangement.
Within the A320neo aircraft family, Shore cited Airbus delivery and backlog figures, including 4,275 A320neo aircraft delivered as of November 25 and a backlog of 7,900 aircraft referenced as of September, for a total of over 12,000 delivered-plus-backlog aircraft. He said Airbus delivered 97 airplanes in December 2025 and is targeting a delivery rate of 75 per month in 2027. Shore also stated that the A320 family surpassed the 737 as the world’s most delivered commercial jet on October 7, 2025.
Shore noted the A320neo family has two engine options—CFM’s LEAP-1A and Pratt & Whitney’s PW1100G—while Park is tied to the LEAP program. He cited an engine-order market share figure of 64.5% for the LEAP engine on the A320 program, and he discussed ongoing reliability issues for Pratt’s geared turbofan engine versus LEAP reliability as a selling point.
Park also reviewed other aircraft and engine programs tied to its MRAS relationship, including COMAC’s C919 and C909 aircraft and Boeing’s 777X (GE9X) program. Shore said Boeing now anticipates FAA certification, entry into service, and first delivery of the 777X in 2027, and he pointed to “increased FAA scrutiny” as a factor in delays.
For Park’s GE Aerospace jet engine programs, the company reported third-quarter sales of $7.5 million and forecast fourth-quarter sales of $7.7 million to $8.7 million. For the year, Park projected $29.0 million to $29.5 million in GE Aerospace jet engine program sales, with Shore describing a recovery back to pre-pandemic levels and expressing his view that the figure could rise “quite aggressively” over the next few years.
Fourth-quarter and full-year fiscal 2026 outlook
For Park overall, management forecast fiscal fourth-quarter sales of $23.5 million to $24.5 million and adjusted EBITDA of $4.75 million to $5.25 million. Shore addressed why EBITDA was not projected to rise in line with the higher sales outlook, pointing to the expected mix: the forecast includes approximately $7.2 million of C2B fabric sales, which he said carries very light margins.
For the full fiscal year 2026, Park projected sales of $72.5 million to $73.5 million and adjusted EBITDA of $17.5 million to $18.0 million. The full-year forecast includes approximately $9.8 million of C2B fabric sales, mostly expected in the fourth quarter.
Defense demand, capacity expansion, and financing plans
Shore described “unprecedented demand” for missile systems, citing depleted stockpiles tied to conflicts in Europe and the Middle East and Wall Street Journal reporting that the Pentagon is pushing manufacturers to materially increase output. He said Park participates in targeted missile systems including Patriot, LRASM, and SM-6, and he highlighted public developments around Patriot production increases.
Shore cited Lockheed announcements describing a plan to increase PAC-3 MSE interceptor production capacity from 600 to 2,000, and he said Park is sole-source qualified for certain specialty ablative materials on the PAC-3 program. He also said Park has been asked to increase expected output by a “significantly larger magnitude” and that the company intends to support demand through additional manufacturing capacity.
The company also outlined updates with ArianeGroup, including a March 2025 agreement under which Park agreed to advance EUR 4,587,000 against future purchases to support expanded C2B manufacturing capacity in Europe (with Park and ArianeGroup participating on a 50/50 basis, according to Shore). Park also committed EUR 350,000 (also described as 50/50) to a study evaluating a potential major C2B fabric manufacturing facility in the U.S., which Shore said is expected to be expensed in the fourth quarter.
To support both commercial and defense opportunities, Park detailed plans for a new composite materials manufacturing plant of approximately 120,000 square feet, designed to roughly double the company’s current composite materials manufacturing capacity. Management estimated a capital budget of about $50 million, with spending timing discussed as roughly 60% in fiscal 2027, 30% in fiscal 2028, and 10% in fiscal 2029. The company cited a target for completion in the second half of calendar 2027 and an operational target in the second half of calendar 2028. Shore said a finalist site is in the Midwest, pending local approvals.
Park also announced it filed a Form S-3 for a $50 million at-the-market offering. Shore said proceeds would be used in part to replenish funds invested in the new plant and to ensure Park has capital to pursue future opportunities, while stressing the plant project is not dependent on the offering.
On capital return and liquidity, Park said it ended the third quarter with $63.6 million of cash and zero long-term debt. The company also cited 41 consecutive years of uninterrupted regular quarterly dividends and said it has paid $608.6 million, or $29.72 per share, in cash dividends since 2005. Park’s board previously authorized repurchases of 1.5 million shares; management said the company has repurchased 718,000 shares at an average price of $12.94, with no buybacks in the second or third quarter and none so far in the fourth quarter.
The call did not include a Q&A session, as no questions were submitted.
About Park Aerospace (NYSE:PKE)
Park Aerospace (NYSE: PKE) is a specialized materials and manufacturing company that designs, develops and produces high-performance composite structures, engineered laminates and specialty adhesives for aerospace, defense and industrial markets. Its product portfolio includes advanced honeycomb cores, composite assemblies, dielectric and high-reliability circuit materials, as well as structural and bonding solutions that meet demanding performance and weight requirements.
The company operates through two principal segments.
